The Fed is dead, maybe by 2012

Quote from EMRGLOBAL:

Kassz007:

Im sure you said the same thing about the EMU. As did most of the world.

Very powerful banks and people are pushing. I'm not the 10th man to know about the "Deal". I'm in the loop. I'm not saying what I know is not disseminated, as it is. You just have to know where to look and who to talk to.

Of course, like the EMU...it will take a decade or more...but the ball is in motion.
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The EMU is still a very young experiment and is a long ways away from being declared a success. We are seeing the cracks now with the sovereign debt crisis.

The Europe situation is somewhat unique as well. Given the close proximity of the countries to one another and the multiple currencies involved, a single currency makes trade incredibly easier and less costly for these countries. I fail to see the same type of benefits of a single currency between the USA and China and you suggested, or even a single currency between North American countries that was suggested by a different poster.
 
There will be no orderly transition to a new global monetary system. It will be chaos first, which means gold by default. And then, either the US re-asserts its power, or another nation becomes the next power.

And the winner will dictate the new global monetary system. After the messy "clean slate" period ends.

Global Monetary systems are dictated by the strong. Think of every global currency that existed. It was a reflection of the existing superpower at that time.

Global currencies have never been peacefully created through international cooperation. Too many vested interests, too many sacrifices, for any or all nations to agree on something. And when there is no clear winner - gold always wins by default.
 
Beginning in 2011 the CPA exam is adopting IFRS with the exception of the REG section of the exam. If the AICPA is adopting IFRS then the US will be adopting IFRS.

Why would Canada and Mexico allow the Fed to control their monetary policy? I don't have the exact answer but I suspect it will happen in a similar fashion as the European Union. The Fed is probably the most powerful central bank in the world and Canada and Mexico may not have a choice but to fall in line. I can't predict the future. All I can do is look at the writing on the wall. History will be the final judge.

Quote from Kassz007:

The new IFRS accounting standards applies to almost every country EXCEPT for the USA.

This is going off topic and sort of a side note - but I believe the reluctance of the USA to adopt IFRS reporting standards will hurt investment in the country. The rest of the world will be reporting a certain way, while the USA continues its own style of accounting. Comparitability with operations in other countries will be impaired and lots of unnecessary work will go into translating US GAAP statements to IFRS and vice versa.



Going back to your post - you asked "why would the Fed NOT want to be able to have that same kind of control of Canada and/or Mexico? Well of course they would like that control, but a better question would be why would Canada and/or Mexico ALLOW the USA to control their monetary policy?
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Quote from the1:

Beginning in 2011 the CPA exam is adopting IFRS with the exception of the REG section of the exam. If the AICPA is adopting IFRS then the US will be adopting IFRS.

Why would Canada and Mexico allow the Fed to control their monetary policy? I don't have the exact answer but I suspect it will happen in a similar fashion as the European Union. The Fed is probably the most powerful central bank in the world and Canada and Mexico may not have a choice but to fall in line. I can't predict the future. All I can do is look at the writing on the wall. History will be the final judge.
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Regardless of the CPA exam, the USA has not agreed to adopt full IFRS standards. I believe they are supposed to make their decision sometime next year although I am uncertain on the exact timeline (by this time, most other countries will already have IFRS fully adopted). CPA's need to know IFRS in order to be competitive in their skillset globally. Much in the same way I was required to learn certain aspects of US GAAP during my education in Canada.


You don't have the answer, but you suspect it will happen? What gives you this suspicion? North America and Europe are vastly different and are in vastly different positions economically. The reasons for a single currency in Europe do not apply to the North American continent in my opinion.

What do you mean when you say the Fed is the most powerful central bank in the world so Canada and Mexico will have to fall in line? What does the writing on the wall say that makes you believe the USA will some day be in control of Canadian and Mexican monetary policy?
 
Quote from Kassz007:

Regardless of the CPA exam, the USA has not agreed to adopt full IFRS standards. I believe they are supposed to make their decision sometime next year although I am uncertain on the exact timeline (by this time, most other countries will already have IFRS fully adopted). CPA's need to know IFRS in order to be competitive in their skillset globally. Much in the same way I was required to learn certain aspects of US GAAP during my education in Canada.


You don't have the answer, but you suspect it will happen? What gives you this suspicion? North America and Europe are vastly different and are in vastly different positions economically. The reasons for a single currency in Europe do not apply to the North American continent in my opinion.

What do you mean when you say the Fed is the most powerful central bank in the world so Canada and Mexico will have to fall in line? What does the writing on the wall say that makes you believe the USA will some day be in control of Canadian and Mexican monetary policy?
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Agree. Nations like China, Japan, Switzerland, etc... would like to manipulate their currency values to their advantages. One world currency means the end of their manipulation.
 
A single currency? I hope not!

I think the fact everybody is so interwoven with each other's economies plays a massive part in the mess we are in now.

The world economy is more like a deck of cards than ever, we are looking at a tiny country like Greece with a GDP smaller than some US states defaulting. Normally that wouldnt be a problem, one bad egg. But now that could destroy the Euro as all the other European countries face the consequences of how the ECB will react, currency depreciation etc which could cause another liquidity crisis.

Investors should be able to look at the investment landscape and distinguish between a good investment and a bad. But now they all move together, the S&P is up half a percent so automatically every other index,commodity, bond yield is up half a percent too.

I think we should be breaking things up not sharing more and more of each others bad decisions.
 
For all the talk about the Fed's future, one point is missed. Were the Fed to go out of business, how would you liquidate it's ever expanding balance sheet? The Fed is one of the largest notional homeowners, bond owners, and (soon) equity holders in the country. You can't sell trillions of assets overnight.
 
Quote from endsongs:

For all the talk about the Fed's future, one point is missed. Were the Fed to go out of business, how would you liquidate it's ever expanding balance sheet? The Fed is one of the largest notional homeowners, bond owners, and (soon) equity holders in the country. You can't sell trillions of assets overnight.
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You're thinking of it backwards.

The Fed owns loans on construction projects like an unfinished Red Roof Inn on it's books - at an imaginary (mark to market) value.

When those pieces of paper and electronic digits representing nothing become worthless, the Fed by association, becomes worthless.
 
As John Maynard Keynes observed in 1931 during the Great Depression: "A sound banker, alas, is not one who foresees danger and avoids it, but one who, when he is ruined, is ruined in a conventional way along with his fellows, so that no one can really blame him."
 
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